Source: https://www.mgeu.ca/news-and-multimedia/news/read,article/1663/government-review-shows-that-changes-to-public-pensions-may-be-on-the-horizon#sthash.zOLPtwqA.
dpbs
Government Review Shows that
Changes to Public Pensions May be on
the Horizon
Jan 12, 2018
Earlier this week, the Manitoba Government
announced plans to launch a public review of
Manitoba pension law. If enacted, potential
changes would be cause for concern for
many Manitobans, including MGEU members
and their families, who have planned their
futures based on the current provisions in
pension legislation.
“Manitobans who have worked hard for
many years and invested in their retirement
deserve to retire with income security and
they should feel confident that their long-
term financial plans won’t be derailed by the
short sighted changes proposed here,” said
MGEU President Michelle Gawronsky.
“Pension plan members need to sit up and
take notice of this because this has
implications for how pension plans are both
funded and managed.”
Reviews like this are done every five years as
part of the Pension Commission’s review of
pension legislation (the Pension Benefits Act).
That commission makes recommendations to
the Province on changes it feels are
necessary. Pension Commission vice-
chairman Tim McGorman is quoted in the
Winnipeg Free Press saying the major
recommendation proposes changes to
defined-benefit plans. He said
recommendations would “relax” funding
requirements and result in lower
contributions for employers.
In addition, new pension plan designs
are contemplated in the
recommendations, including target
benefit pension plans and shared risk
pensions plans.
Target Benefit Pension Plans and
Shared Risk Pension Plans pose the
following risks to members:
• Provide less benefit certainty to
members with potential reduction in pension contributions and retirees’
benefits during retirement; payments.
• Have the potential to create a two-tier Meanwhile, Gawronsky says it’s important to
plan where existing members would note that the PC Party pledged to MGEU
keep their defined benefit plan, while members during the 2016 election that they
new hires would be subject to potential would make no changes to public pension
reductions if the plan doesn’t meet plans if elected.
targets;
“Our union remains committed to protecting
• Open the door to promote the full public pensions and ensuring the
conversion of a Defined Benefit pension government lives up to its promise to protect
plan to less predictable benefits under a them as well.”
Defined Contribution (DC) pension There will be no public meetings on any of
plan. Conversion to DC plans have shown the proposed changes. Instead, those
in many cases to be more costly to the affected are asked to submit comments on
plan rather than yielding savings; and the government’s website at
• Don’t require the employer to fund pensions@gov.mb.ca. The deadline to
deficits. submit comments is February 21, 2018.
New Brunswick’s Shared Risk Pension Plan
currently has three legal challenges against
its conversion from a public sector pension
plan to a shared risk pension plan.
McGorman said he was unable to say what
effect the changes would have on workers’